The mammalian yolk sac provides an important nutritive role in the early postimplantatlon embryo. Yolk sac development is highly sensitive to the regulation of temporal and spatial expression of a number of genes;however, little work has been done on the relationship of chromatin structure and the transcriptional apparatus required specifically during morphogenesis of this tissue. Transcriptional activators bound to enhancers or promoters recruit chromatin[unreadable]modifying complexes, which covalently modify N-terrninal histone tails or utilize ATPase activity to alter the conformation and/or position of nucleosomes. As a result, promoters adopt an ~open" chromatin configuration so transcription can be initiated. Conversely, transcriptional repressors ean recruit similar or identical complexes to other loci to establish a [unreadable]closedchromatin configuration that precludes transcription. Existing data suggest that these complexes regulate both the hematopoietic and non[unreadable]hematopoietic aspects of yolk sac development but that these functions are independent of one another. To confirm this hypothesis, a 8rg1 cDNA-transgene will be specifically expressed In the hematopoietic compartment to rescue this defect. These data will confirm whether the complexes playa distinguishable role in endothelial cells of the yolk sac. In addition, based on preliminary data, experiments are proposed to test whether down regulation of Fz5 (frizzled 5) expression and upregulation of Cdh2 (eadherin 2) on the mutant background reduces the amount of free J)[unreadable]catenin for WNT signaling and that this misregulation intersects with the Tgfb pathway. Misregulation of these pathways are known to regulate proliferation, migration, differentiation and apoptosis, all of which are key steps in yolk sac development.